U.N. says help poor nations as food prices rise

from Reuters

DHAKA (Reuters) - Donor nations should increase financial assistance to developing countries such as Bangladesh to cope with rising food and oil prices, the head of the United Nations Development Programme said on Wednesday.

Kemal Dervis made the appeal at the end of a visit to Bangladesh to review programmes for rehabilitation of millions of people hit by a cyclone last year.

"Support from oil-rich countries, as well as other donors, could have positive benefits for Bangladesh and other lower income countries," Dervis said in a statement.

Edible oil and food prices have increased by 100 percent over the past one year in Bangladesh.

State-subsidised petroleum products also rose 22 percent.

Around 40 percent of Bangladesh's 140 million people live below the poverty line, spending nearly 70 percent of their income on food items.

Dervis said that Bangladesh needed international aid even more "because it was also struggling to establish democracy in the country."

"What happens here is particularly important to the people of Bangladesh, but a successful democratic Bangladesh that can overcome political and economic difficulties is an example to other lower income countries, to the Muslim World, and many other countries facing similar problems," Dervis said.

Bangladesh, which is currently led by an army-backed interim administration, plans to hold elections later this year after completing a crackdown on corruption in the impoverished nation.

In December, annual food inflation in Bangladesh reached 16 percent, according to official data.

(Reporting by Nizam Ahmed; Writing by Anis Ahmed; Editing by Sanjeev Miglani)